Alliance Bank Malaysia Berhad (Alliance Bank) today reported a year-on-year (YOY) net profit after tax increase of 18.3% to RM677.8 million for the financial year ended 31 March 2023 (“FY2023”).
Revenue grew 2.8% YOY to RM1.92 billion as net interest income rose 11.6% YOY to RM1.65 billion on the back of higher loans volume and OPR hikes. Net interest margin improved 11 basis points (“bps”) to 2.64%.
Client-based fee income (excluding brokerage) grew to RM284.1 million, attributable to higher wealth management, foreign exchange sales and trade fees. Cost-to-income ratio was 45.9%.
SME and Consumer Banking loans grew 13.1% and 5.2% YOY respectively, contributing to higher overall loans growth momentum at 6.2% YOY. Customer-based funding grew 6.8% YOY with fixed deposits increasing 18.6% YOY.
The Bank’s funding is healthy and CASA ratio stood at 41.9%, one of the highest in the industry. Net credit cost for FY2023 improved 16.2 bps YOY to 31.9 bps due to the net release of management overlays.
The pandemic-related loans under relief have decreased further to RM1.25 billion, representing 2.5% of the Bank’s total loan book. Alliance Bank remains committed to helping customers who require further financial assistance.
The Bank is well capitalised with Common Equity Tier-1 (“CET 1”) ratio remaining robust at 14.5% and Tier-1 Capital ratio at 15.3% respectively as at 31 March 2023. Total capital ratio was at 19.4%.
The strong capital levels support the Bank’s expansion plans. The Bank’s liquidity position is also strong with coverage ratio of 161.9% (industry average: 154.7%) and loan to fund ratio of 87.4%.
Alliance Bank has proposed a second interim dividend of 10 sen per share, bringing the total dividend to 22 sen per share for a 50% total dividend payout ratio, while maintaining robust liquidity and capital positions.
For the FY2023 strategic priorities, new-to-bank customer acquisition grew 58% YOY to
approximately 89,000 customers, exceeding the 80,000 target by 11%. Acquisition of dual-
relationship business owners increased 72% YOY to 8,700. Digital transactions grew 19% YOY as a higher proportion of customers adopted the bank’s mobile and online solutions.
